Comment Re:Sick and tired of people ragging on mark-to-mar (Score 1) 368
Oops, wrong button. The second quote should be:
FASB's "mark-to-market" accounting rules forced AIG and Bear Stearns to admit that their liabilities had exceeded their assets, instead of allowing the companies to invent a price for the assets until the assets were finally sold.
For too darn long, companies could just make up prices for assets they wanted to value. Forcing the assets to be valued at what they're actually worth (i.e., what somebody will pay for them) is just common sense.
FASB's "mark-to-market" accounting rules forced AIG and Bear Stearns to admit that their liabilities had exceeded their assets, instead of allowing the companies to invent a price for the assets until the assets were finally sold.
For too darn long, companies could just make up prices for assets they wanted to value. Forcing the assets to be valued at what they're actually worth (i.e., what somebody will pay for them) is just common sense.